Sensient Technologies Corporation (NYSE:SXT) Just Reported Second-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

Last week, you might have seen that Sensient Technologies Corporation (NYSE:SXT) released its second-quarter result to the market. The early response was not positive, with shares down 4.9% to US$77.70 in the past week. Sensient Technologies reported in line with analyst predictions, delivering revenues of US$404m and statutory earnings per share of US$2.21, suggesting the business is executing well and in line with its plan. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Sensient Technologies

Taking into account the latest results, the consensus forecast from Sensient Technologies' two analysts is for revenues of US$1.55b in 2024. This reflects an okay 3.3% improvement in revenue compared to the last 12 months. Per-share earnings are expected to bounce 37% to US$2.83. In the lead-up to this report, the analysts had been modelling revenues of US$1.53b and earnings per share (EPS) of US$2.84 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$85.00, showing that the business is executing well and in line with expectations.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Sensient Technologies' growth to accelerate, with the forecast 6.6% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.6% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sensient Technologies to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Sensient Technologies. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Sensient Technologies that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com